Auditor Report of National Oxygen Ltd.

Mar 31, 2015

We have audited the accompanying standalone financial statements of
NATIONAL OXYGEN LIMITED as at 31st March 2015, which comprise the
Balance Sheet as at 31st March 2015 and the Statement of Profit and
Loss, the Cash Flow Statement for the year ended on that date, and a
summary of significant accounting policies and other explanatory
information.

The Company's Board of Directors is responsible for the matters stated
in Section 134(5) of the Companies Act, 2013 ("the Act") with respect
to the preparation of these standalone financial statements that give a
true and fair view of the financial position, financial performance and
cash flows of the Company in accordance with the accounting principles
generally accepted in India, including the Accounting Standards
specified under Section 133 of the Act, read with Rule 7 of the
Companies (Accounts) Rules, 2014. This responsibility also includes
maintenance of adequate accounting records in accordance with the
provisions of the Act for safeguarding the assets of the Company and
for preventing and detecting frauds and other irregularities; selection
and application of appropriate accounting policies; making judgments
and estimates that are reasonable and prudent; and design,
implementation and maintenance of adequate internal financial controls,
that were operating effectively for ensuring the accuracy and
completeness of the accounting records, relevant to the preparation and
presentation of the financial statements that give a true and fair view
and are free from material misstatement, whether due to fraud or error.

3. Auditor's Responsibility :

Our responsibility is to express an opinion on these financial
statements based on our audit. We have taken into account the
provisions of the Act, the accounting and auditing standards and
matters which are required to be included in the audit report under the
provisions of the Act and the Rules made there under. We conducted our
audit in accordance with the Standards on Auditing specified under
Section 143(10) of the Act. Those Standards require that we comply with
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement An audit involves performing procedures to
obtain audit evidence about the amounts and the disclosures in the
financial statements. The procedures selected depend on the auditor's
judgment, including the assessment of the risks of material
misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal
financial control relevant to the Company's preparation of the
financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on whether the Company has in
place an adequate internal financial controls system over financial
reporting and the operating effectiveness of such controls. An audit
also includes evaluating the appropriateness of the accounting policies
used and the reasonableness of the accounting estimates made by the
Company's Directors, as well as evaluating the overall presentation of
the financial statements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our
opinion on the standalone financial statements.

4. Opinion

In our opinion and to the best of our information and according to the
explanations given to us, the aforesaid standalone financial statements
give the information required by the Companies Act 2013, in the manner
so required and give a true and fair view in conformity with the
accounting principles generally st accepted in India of the state of
affairs of the Company as at 31 March, 2015 , and its Loss and its cash
flows for the year ended on that date.

5. Report on Other Legal and Regulatory Requirements :

As required by the Companies (Auditor's Report) Order ,2015 ('the Order
'),issued by the Central Government of India in terms of sub-section
(11) of section 143 of the Companies Act, 2013 we give in the Annexure
a statement on the matters specified in paragraphs 3 and 4 of the
Order, to the extent applicable.

As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations
which to the best of our knowledge and belief were necessary for the
purposes of our audit.

In our opinion, proper books of account as required by law have been
kept by the Company so far as it appears from our examination of those
books ;

The Balance Sheet, the Statement of Profit and Loss and the Cash Flow
Statement dealt with by this Report are in agreement with the books of
account.

(b) In our opinion, the aforesaid standalone financial statements
comply with the Accounting Standards specified under Section 133 of the
Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

(c) There are no observations or comments on financial transactions or
matters which , in our opinion, may have any adverse effect on the
functioning of the Company

(d) On the basis of the written representations received from the
directors as on 31st March, 2015 taken on record by the Board of
Directors, none of the directors is disqualified as on 31st March, 2015
from being appointed as a director in terms of Section 164 (2) of the
Act.

With respect to the other matters to be included in the Auditor's
Report in accordance with Rule 11 of the Companies (Audit and Auditors)
Rules, 2014, in our opinion and to the best of our information and
according to the explanations given to us:

i) The Company has disclosed the impact of pending litigations on its
financial position in its financial statements Â Refer Note No. 33 to
the financial statements;

The Company has made provision, as required under the applicable law or
accounting standards, for material foreseeable losses, if any, on
long-term contracts including derivative contracts.

There has been no delay in transferring amounts, required to be
transferred, to the Investor Education and Protection Fund by the
Company

i) a) The Company has maintained proper records showing full
particulars including quantitative details and situation of its Fixed
Assets.

b) The Fixed Assets of the Company have been physically verified by the
management, wherever possible, at the close of the year as confirmed by
the management. As informed to us, no material discrepancy has come to
notice on such physical verification;

ii) a) The management has conducted Physical verification of
Inventories, wherever possible, at all its locations at reasonable
intervals during the year

b) The procedures of physical verification of stock followed by the
Management are, in our opinion, reasonable and adequate in relation to
the size of the Company and nature of its business ;

c) The company is maintaining proper records of inventory. As far as we
can ascertain and according to the information and the explanations
given to us, the discrepancies noticed between the physical stocks and
book stocks were not material and the same have been properly dealt
with in the books of account.

iii) As per the information and explanations provided to us, the
company has not granted any loans, secured or unsecured, to companies,
firms or other parties listed in the register maintained under section
189 of the Companies Act 2013 and hence the requirements of sub clauses
(a) and (b) of clause (iii) of the Order are not applicable.

iv) On the basis of checks carried out during the course of audit and
as per explanations given to us, in our opinion, there is adequate
internal control system commensurate with the size of the Company and
the nature of its business for the purchase of Inventory and Fixed
Assets and for the sale of goods and services. During the course of our
Audit, no major weakness or continuing failure to correct any major
weakness has been noticed in the internal control system in respect of
these areas;

v) In our opinion and according to the information and explanations
given to us, the company has not accepted any deposits to which the
directives of the Reserve Bank of India and the provisions of Section
73 to 76 or any other relevant provisions of the Companies Act, 2013
and the rules framed there under apply;

vi) The Company has made and maintained proper Cost records pursuant to
the rules made by the Central Government for the maintenance of cost
records under section 148 (1) of the Companies Act, 2013 in respect of
the products manufactured by it, but no detailed examination of such
records have been carried out by us.

vii) a) The company has been generally regular in depositing undisputed
statutory dues including Provident Fund, Employees' State Insurance,
Income-tax, Sales-tax, Wealth Tax, Service Tax, Duty of Customs, Duty
of Excise, Value added tax, cess and other material statutory dues with
the appropriate authorities. Further, according to the information and
explanations given to us and the books and records examined by us,
there was no undisputed amount outstanding as on 31st March 2015 in
respect of the above statutory dues for a period of more than six
months from the date they became payable;

b) According to the records of the company, the dues outstanding (net
of Advances) in respect of Income tax ,Sales Tax, Wealth Tax, Service
Ta x , Duty of Customs, Duty of Excise, Value added st tax, or Cess on
account of any dispute as on 31 March 2015 , are as follows :

Name of the Nature of Dues Amount Period to Forum where
Statute Rs in Lacs which the dispute
amount
relates pending

Central Departmental
appeal
against the 5.71 2000-01 Madras High
Excise
Act, favorable
order passed
by CESTAT
Court
1944 in respect
of 8% duty
demanded on
supply to
ISRO under
Nil rate of
duty while
availing
Canvas Credit

c) The amount required to be transferred to investor education and
protection fund in accordance with the relevant provisions of the
Companies Act, 1956 (1 of 1956) and rules made there under has been so
transferred to such fund within time.

viii) The Company has accumulated losses of Rs.1302.75 Lacs and has
incurred cash loss of Rs.676.97 Lacs in the current financial year and
Rs.374.68 Lacs in the immediately preceding financial year;

ix) Based on our audit procedures, and as per the information and
explanations given to us by the management, though there have been
delays in repayment of dues during the year, as at the year end the
company has not defaulted in repayment of dues to financial
institutions or banks or debenture holders;

x) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from bank
or financial institutions.

xi) The existing term loans as well as the term loans raised during the
year have been utilized for the purpose for which the Term Loan were
raised .

xii) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given to us by the management, we
report that no fraud on or by the company has been noticed or reported
during the course of our audit;

For SINGHI & CO.,

Chartered Accountants

Firm Regn No. 302049E

Sd/-

(SUDESH CHORARIA)

Place: Chennai Partner

Date : 29th May 2015. Membership No. 204936

Mar 31, 2014

We have audited the attached financial statements of NATIONAL OXYGEN
LIMITED as at 31st March 2014, which comprise the Balance Sheet as at
31st March 2014 and the Statement of Profit and Loss and the Cash Flow
Statement for the year ended on that date, and a summary of significant
accounting policies and other explanatory information.

2. Management''s Responsibility for the Financial Statements :

Management is responsible for the preparation of these financial
statements that give a true and fair view of the financial position,
financial performance and cash flows of the company in accordance with
the Accounting Standards referred to in sub section (3C) of section 211
of the Companies Act, 1956 ("the Act"). This responsibility
includes the design, implementation and maintenance of internal control
relevant to the preparation and presentation of the financial
statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.

3. Auditor''s Responsibility :

Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with standards on Auditing issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with
ethical requirements and plan and perform audit to obtain reasonable
assurance about whether the financial statements are free from material
misstatement.

An audit involves performing procedures to obtain audit evidence about
the amounts and disclosures in the financial statements. The procedures
selected depend on the auditor''s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the Company''s preparation and
fair presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity''s
internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.

4. Opinion

In our opinion and to the best of our information and according to the
explanations given to us, the financial statements give the information
required by the Act in the manner so required and give a true and fair
view in conformity with the accounting principles generally accepted in
India:

a) in the case of the Balance Sheet, of the state of affairs of the
Company as at March 31, 2014;

b) in the case of the Statement of Profit and Loss , of the Loss for
the year ended on that date; and

c) in the case of the Cash Flow Statement, of the cash flows for the
year ended on that date.

5. Report on Other Legal and Regulatory Requirements :

As required by the Companies (Auditor''s Report) Order 2003 (as amended)
issued by the Central Government of India in terms of sub section (4A)
of Section 227 of the Companies'' Act 1956, we give in the Annexure a
statement on the matters specified in paragraph 4 & 5 of the said
Order.

Further to our comments in the Annexure referred to above, we report
that:

a) We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;

b) In our opinion, proper books of account as required by law have been
kept by the company so far as appears from our examination of those
books.;

c) The Balance Sheet, Statement of Profit and Loss and Cash Flow
Statement dealt with by this report are in agreement with the books of
account;

d) In our opinion, the Balance Sheet, Statement of Profit and Loss and
Cash Flow Statement dealt with by this report comply with the
Accounting Standards referred to in sub section (3C) of Section 211 of
the Companies Act, 1956;

e) On the basis of the written representations received from the
directors as on 31st March 2014 and taken on record by the Board of
Directors, we report that none of the directors are disqualified as on
31st March 2014 from being appointed as a director in terms of clause
(g) of sub section (1) of section 274 of the Companies Act'' 1956;

ANNEXURE TO THE INDEPENDENT AUDITOR''S REPORT (Referred to in our Report
of even date on the Accounts of NATIONAL OXYGEN LIMITED as at and for
the year ended 31st March 2014)

i) a) The Company has maintained proper records to show full
particulars including quantitative details and situation of its Fixed
Assets.

b) The Fixed Assets of the Company have been physically verified by the
management, wherever possible, at the close of the year as confirmed by
the management. As informed to us, no material discrepancy has come to
notice on such physical verification.

c) The Company has not disposed off any substantial part of fixed
assets during the year.

ii) a) The management has conducted Physical verification of
Inventories at all its locations at reasonable intervals during the
year ;

b) The procedures of physical verification of stock followed by the
Management are, in our opinion, reasonable and adequate in relation to
the size of the Company and nature of its business ;

c) The company is maintaining proper records of inventory. As far as we
can ascertain and according to the information and the explanations
given to us, the discrepancies noticed between the physical stocks and
book stocks were not material and the same have been properly dealt
with in the books of account.

III) a) As per the information & explanations provided to us, the
company has not granted any loans, secured or unsecured, to companies,
firms or other parties listed in the register maintained under Section
301 of the Companies Act, 1956.

b) The company has taken unsecured loan from a company listed in the
register maintained under section 301 of the Companies Act 1956 . The
maximum amount outstanding during the year was Rs. 4,89,00,388 and the
balance outstanding as on 31st March 2014 was Rs. 4,89,00,388;

c) The rate of interest and other terms and conditions in respect of
the unsecured loans taken by the company, are prima facie not
prejudicial to the interest of the company.

d) There is no specific stipulations regarding the repayment of the
loan and interest amount in respect of the unsecured loans taken.
However, as per the information & explanations provided to us, the
repayment of the loan and interest amount has been made promptly, as
and when demanded.

iv) On the basis of checks carried out during the course of audit and
as per explanations given to us, in our opinion, there are adequate
internal control procedures commensurate with the size of the Company
and the nature of its business for the purchase of Inventory and Fixed
Assets and for the sale of goods and services. During the course of our
Audit, no major weakness has been noticed in the internal controls in
these respects.

v) a) As per the information & explanations given to us, particulars of
transactions that have been undertaken during the year in pursuance of
contracts or arrangements that need to be entered into the register
maintained under section 301 of the Companies Act, 1956, have been so
entered.

b) In our opinion, and according to the information and explanations
given to us, and as confirmed by the Company, all the transactions with
each of such parties during the financial year have been entered into
at prices which are reasonable having regard to the prevailing market
prices at the relevant time;

vi) The company has not accepted any deposits from the public during
the year, to which the provisions of Section 58-A , 58-AA or any other
relevant provisions of the Companies Act, 1956 and the rules framed
there under apply;

vii) The company has a separate Internal Audit System . In our opinion,
the Internal Audit system is commensurate with the size and nature of
its business;

viii) The Company has maintained proper Cost records as prescribed by
the Central Government under Section 209 (1)(d) of the Companies Act
1956 for the products manufactured by it, but no detailed examination
of such records have been carried out by us.

ix) b) According to the information and explanations given to us and
the books and records examined by us, there was no undisputed amount
outstanding as on 31st March'' 2014 in respect of Provident Fund,
Investor Education and Protection Fund, Employees'' State Insurance,
Income-tax, Sales-tax, Wealth Tax, Service tax, Custom Duty, Excise
Duty, cess and other statutory dues for a period of more than six
months from the date they became payable;

c) According to the records of the company and as per the information
and explanations provided to us, the dues outstanding (net of Advances)
in respect of Sales Tax, Income tax, Customs Duty, Wealth Tax,Service
Tax, Excise Duty, Cess etc.,on account of any dispute, are given below
:

x) The Company has accumulated losses of Rs.219.74 Lacs, and has
incurred cash loss of Rs.374.68 Lacs in the current financial year.
However, no cash loss was incurred in the immediately preceding
financial year.

xi) Based on our audit procedures, and as per the information and
explanations given to us by the management, the company has not
defaulted in repayment of dues to financial institutions and banks;

xii) According to the information and explanations given to us, the
company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities;

xiii) The provisions of any special statute applicable to chit fund,
nidhi or mutual benefit fund / societies are not applicable to the
company;

xiv) In our opinion, the company is not dealing or trading in shares,
securities, debentures and other investments, and hence, the
requirements of Para 4 (xiv) of the above Order are not applicable to
the company;

xv) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from bank
or financial institutions;

xvi) The term loan raised during the year as well as the existing term
loan has been utilized for the purpose for which it was availed;

xvii) According to the information and explanations given to us, in our
opinion, short term funds have not been used for long term purposes.

xviii) During the year, the company has not made any preferential
allotment of shares.

xix) The company does not have any outstanding debentures during the
year.

xx) The company has not raised any money by way of public issue during
the year;

xxi) Based on the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given to us by the management, we
report that no fraud on or by the company has been noticed or reported
during the course of our audit. .

For SINGHI & CO.,
Chartered Accountants
(SUDESH CHORARIA)

Partner

Membership No. 204936

Place : Chennai, FR No. 302049E

Date : 22nd May 2014.

Mar 31, 2012

We have audited the attached Balance Sheet of NATIONAL OXYGEN LIMITED
as at 31st March 2012, and the Profit & Loss Account and Cash Flow
Statement for the year ended on that date, annexed thereto. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally
accepted in India. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining , on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.

As required by the Companies (Auditor's Report) Order 2003 (as amended)
issued by the Central Government in terms of sub section (4A) of
Section 227 of the Companies' Act 1956, we enclose in the Annexure a
statement on the matters specified in paragraph 4 & 5 of the said
order.

Further to our comments in the Annexure referred to above, we report
that:

1. We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of our
audit;.

2. In our opinion, the company has kept proper books of Accounts as
required by law so far as appears from our examination of those books;

3. The Balance Sheet, Profit and Loss account and Cash Flow Statement
dealt with by the report are in agreement with the books of account;

4. In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the Accounting
Standards referred to in sub section (3C) of Section 211 of the
Companies Act, 1956.

5. On the basis of the written representations received from the
directors as on 31st March 2012 and taken on record by the Board of
Directors, we report that none of the directors are disqualified as on
31st March 2012 from being appointed as a director in terms of clause
(g) of sub section (1) of section 274 of the Companies Act'1956.

6. In our opinion, and to the best of our information and according to
the explanations given to us, the said Financial Statements, read
together with the notes thereon, give the information required by the
Companies Act, 1956 in the manner so required and give a true and fair
view in conformity with the Accounting principles generally accepted in
India:

i. In the case of Balance Sheet, of the state of affairs of the Company
as at 31st March, 2012.

ii In the case of the Profit & Loss Account, of the Profit of the
Company for the year ended on that date, and '

iii In the case of the Cash Flow Statement of the Cash flows of the
Company for the year ended on that

ANNEXURE TO THE AUDITOR'S REPORT

(Referred to in our Report of even date on the Accounts of NATIONAL
OXYGEN LIMITED as at and for the year ended 31st March 2012)

i) a The Company has maintained proper records to show full particulars
including quantitative details and situation of its Fixed Assets.. ,

b) The Fixed Assets of the Company have been physically verified' by
the ' management, wherever possible, at the close of the year as
confirmed by the management. As informed to us, no material discrepancy
has come to notice on such physical verification.

c) The Company has not disposed off any substantial part of fixed
assets during the year.

ii) a) The management has conducted Physical verification of
Inventories at all its locations at reasonable intervals during the
year;

b) The procedures of physical verification of stock followed by the
Management are, in our opinion, reasonable and adequate in relation to
the size of the Company and nature of its business ;

c) The company is maintaining proper records of inventory. As far as we
can ascertain and according to the information and the explanations
given to us, the discrepancies noticed between the physical stocks and
book stocks were not material and the same have been properly dealt
with in the books of account.

iii) a) As per the information & explanations provided to us, the
company has not granted any loans, secured or unsecured, to companies,
firms or other parties listed in the register maintained under Section
301 of the Companies Act, 1956. .

b) As per the information & explanations provided to us, the company
has not taken any loans, secured or unsecured, from companies, firms or
other parties listed in the register maintained under Section 301 ofthe
Companies Act, 1956.

iv) On the basis of checks carried out during the course of audit and
as per explanations given to us, in our opinion, there are adequate
internal control procedures commensurate with the size ofthe Company
and the nature of its business for the purchase of Inventory and Fixed
Assets and for the sale of goods and services. During the course of our
Audit, no major weakness has been noticed in the internal controls in
these respects. .

v) a) As per the information & explanations given to us, particulars of
transactions that' have been undertaken during the year in pursuance
of contracts or arrangements that need to be entered into the register
maintained under section 301 ofthe Companies Act, 1956, have been so
entered.

b) In our opinion, and according to the information and explanations
given to us, and as confirmed by the Company, all the transactions with
each of such parties during the financial year have been entered into
at prices which are reasonable having regard to the prevailing market
prices at the relevant time;

vi) The company has not accepted any deposits from the public during
the year, to which the provisions of Section 58-A, 58-AA or any other
relevant provisions of the Companies Act, 1956 and the rules framed
there under apply;

vii) The company has introduced a separate Internal Audit System during
the year. In our opinion, the Internal Audit system is commensurate
with the size and nature of its business;

viii) The Company has maintained proper Cost records as prescribed by
the Central Government under Section 209 (1)(d) ofthe Companies Act
1956 for the products manufactured by it, but no detailed examination
of such records have been carried out by us.

ix) b) According to the information and explanations given to us and
the books and records examined by us, there was no undisputed amount
outstanding as on 31st March' 2012 in respect of Provident Fund,
Investor Education and Protection Fund, Employees' State Insurance,
Income-tax, Sales-tax, Wealth Tax, Service tax, Custom Duty, Excise
Duty, cess and other statutory dues for a period of more than six
months from the date they became payable; .

ix) c) According to the records of the company and as per the
information and explanations provided to us, the dues outstanding (net
of Advances) in respect of Sales Tax, Income tax, Customs Duty, Wealth
Tax,Service Tax, Excise Duty, Cess etc. on account of any dispute, are
given below:

Period to Forum where
Name of the Amount
Statute Nature of Dues (Rs.in
Lacs) which the dispute
amount
relates pending

Employees ESI being
demanded for the
period 0.72 1983-84 to Principal
State 1984 to 1989 1988-89 Labour Court
Insurance
Act

x) The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.

xi) Based on our audit procedures, and as per the information and
explanations given to us by the management, the company has not
defaulted in repayment of dues to financial institutions and banks;

xii) According to the information and explanations given to us, the
company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities;

xiii) The provisions of any special statute applicable to chit fund,
nidhi or mutual benefit fund / societies are not applicable to the
company;

xiv) In our opinion, the company is not dealing or trading in shares,
securities, debentures and other investments, and hence, the
requirements of Para 4 (xiv) of the above Order are not applicable to
the company; .

xv) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from bank
or financial institutions;

xvi) The term loan raised during the year as well as the existing term
loan has been utilized for the purpose for which it was a vailed;

xvii) According to the information and explanations given to us, in our
opinion, short term funds have not been used for long term purposes. ,

xviii) During the year, the company has not made any preferential
allotment of shares. .

xix) The company does not have any outstanding debentures during the
year.

xx) The company has not raised any money by way of public issue during
the year;

xxi) Based on the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given to us by the management, we
report that no fraud on or by the company has been noticed or reported
during the course of our audit.

For SINGHI & CO.,
Chartered Accountants
(SUDESH CHORARIA)
Partner

Place : Chennai, Membership No. 204936

Date : 30.05.2012. FR No. 302049E

Mar 31, 2010

I We have audited the attached Balance Sheet of NATIONAL OXYGEN LIMITED
as at 31st March 2010, and the Profit & Loss Account and Cash Flow
Statement for the year ended on that date, annexed thereto, which are
the revised statements of the original Balance Sheet, Profit & Loss
Account and Cash Flow Statement covered by our Audit report dated 28th
May 2010. These financial statements are the responsibility of the
Companys management. Our responsibility is to express an opinion on
these financial statements based on our audit.

II We conducted our audit in accordance with auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable
basis for our opinion.

III We have considered the earlier Audit report dated 28lh May 2010 on
the original accounts and have examined the changes made therein which
is as under:

Reference is invited to Note No, 2 of Schedule 12, wherein the Board of
Directors have recommended a Dividend of 10% fortheF.Y. 2009-10 which
has been incorporated in the revised accounts together with the
Dividend tax thereon amounting to Rs. 36.34 Lacs.

IV. As required by the Companies (Auditors Report) Order 2003 (as
amended) issued by the Central Government in terms of sub section (4A)
of Section 227 of the CompaniesAct 1956, we enclose in the Annexure a
statement on the matters specified in paragraph 4 & 5 of the said
order.

V. Further to our comments in the Annexure referred to in paragraph IV
above, and subject to our comments in paragraph III above,
wereportthat:

1 We have obtained all the information and explanations, which to the
best of our knowledge and belief were necessary for the purposes of
ouraudit;

2 In our opinion, the company has kept proper books of Accounts as
required by law so far as appears from our examination of those books;

3 The Balance Sheet, Profit and Loss account and Cash Flow Statement
dealt with by the report are in agreement with the books of account;

4 In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement dealt with by this report comply with the Accounting
Standards referred to in sub section (3C) of Section 211 of the
Companies Act, 1956.

5 On the basis of the written representations received from the
directors as on 31s1 March 2010 and taken on record by the Board of
Directors, we report that none of the directors are disqualified as on
31s1 March 2010 from being appointed as a director in terms of clause
(g) of sub section (1) of section 274 of the Companies Act 1956.

6 In our opinion, and to the best of our information and according to
the explanations given to us, the said Accounts, read together with the
NOTES thereon, give the information required by the Companies Act,
1956 in the manner so required and give a true and fair view in
conformity with the Accounting principles generally accepted in India :

i) In the case of Balance Sheet, of the state of affairs of the Company
as at 31st March, 2010.

ii) In the case of the Profit & Loss Account of the Loss of the Company
for the year ended on that date and

iii)ln the case of the Cash Flow Statement of the Cash flows of the
Company for the year ended on that date.

ANNEXURE TO THE AUDITORS REPORT

(Referred to in our Report of even date on the Revised Accounts of
NATIONAL OXYGEN LIMITED as at and for the year ended 31st March 2010)

i) a) The Company has maintained proper records to show full
particulars including quantitative details and situation of its Fixed
Assets.

b) The Fixed Assets of the Company have been physically verified by the
management, wherever possible, at the close of the year as confirmed by
the management. As informed to us, no material discrepancy has come to
notice on such physical verification.

c) The Company has not disposed off any substantial part of fixed
assets during the year.

ii) a) The management has conducted Physical verification of
Inventories at all its locations at reasonable intervals during the
year;

b) The procedures of physical verification of stock followed by the
Management are, in our opinion, reasonable and adequate in relation to
the size of the Company and nature of its business;

c) The company is maintaining proper records of inventory. As far as we
can ascertain and according to the information and the explanations
given to us, the discrepancies noticed between the physical stocks and
book stocks were not material and the same have been properly dealt
with in the books of account.

iii) a) As per the information & explanations provided to us, the
company has not granted any loans, secured or unsecured, to companies,
firms or other parties listed in the register maintained under Section
301 of the Companies Act, 1956.

b) As per the information & explanations provided to us, the company
has not taken any loans, secured or unsecured, from companies, firms or
other parties listed in the register maintained under Section 301 of
the Companies Act, 1956.

iv) On the basis of checks carried out during the course of audit and
as per explanations given to us, in our opinion, there are adequate
internal control procedures commensurate with the size of the Company
and the nature of its business for the purchase of Inventory and Fixed
Assets and for the sale of goods and services. During the course of our
Audit, no major weakness has been noticed in the internal controls in
these respects.

v) a) As per the information & explanations given to us, particulars of
transactions that have been undertaken during the year in pursuance of
contracts or arrangements that need to be entered into the register
maintained under section 301 of the Companies Act, 1956, have been so
entered.

b) In our opinion, and according to the information and explanations
given to us, and as confirmed by the Company, all the transactions with
each of such parties during the financial year have been entered into
at prices which are reasonable having regard to the prevailing market
prices at the relevant time;

vi) The company has not accepted any deposits from the public during
the year, to which the provisions of Section 58-A, 58-AAor any other
relevant provisions of the Companies Act, 1956 and the rules framed
there under apply;

vii) The company has no separate Internal Audit System. However, in our
opinion, the existing Internal control procedures are commensurate with
the size and nature of its business;

viii) The Central Government has not prescribed maintenance of cost
records under Section 209 (1 )(d) of the Companies Act 1956 for any of
the products of the company.

ix) a) The company has been regular in depositing undisputed statutory
dues including Provident Fund, Investor Education and Protection Fund,
Employees State Insurance, Income-tax, Sales-tax, Wealth Tax, Service
tax, Custom Duty, Excise Duty, cess and other material statutory dues
with the appropriate authorities;

ix) b) According to the information and explanations given to us and
the books and records examined by us, there was no undisputed amount
outstanding as on 31st March 2010 in respect of Provident Fund,
Investor Education and Protection Fund, Employees State Insurance,
Income-tax, Sales-tax, Wealth Tax, Service tax, Custom Duty, Excise
Duty, cess and other statutory dues for a period of more than six
months from the date they became payable;

c) According to the records of the company and as per the information
and explanations provided to us, the dues outstanding (net of Advances)
in respect of Sales Tax, Income tax, Customs Duty, Wealth Tax, Service
Tax, Excise Duty, Cess etc.,on account of any dispute, are given below:

Name of the Forum where
Amount Peroid to
Nature of
Dues which the dispute
Statute (Rs. in
Lacs) amount
relates pending

Central Departmental appeal
against 5.71 2000-01 Madras High
Excise Act, the favourable order
passed by Court
1944 CESTAT in respect of
8% duty
demanded on supply to
ISRO
under Nil rate of duty
while
availing Cenvat Credit

Employees ESI being demanded for
the 0.72 1983-84
to Principal
State period 1984 to 1989 1988-89 Labour Court
Insurance
Act

x) The Company has no accumulated losses and has not incurred cash
losses in the current financial year and in the immediately preceding
financial year.

xi) Based on our audit procedures, and as per the information and
explanations given to us by the management, the company has not
defaulted in repayment of dues to financial institutions and banks;

xii) According to the information and explanations given to us, the
company has not granted any loans or advances on the basis of security
by way of pledge of shares, debentures and other securities;

xiii) The provisions of any special statute applicable to chit fund,
nidhi or mutual benefit fund / societies are not applicable to the
company;

xiv) In our opinion, the company is not dealing or trading in shares,
securities, debentures and other investments, and hence, the
requirements of Para 4(xiv) of the above Order are not applicable to
the company;

xv) According to the information and explanations given to us, the
company has not given any guarantee for loans taken by others from bank
or financial institutions;

xvi) The term loan raised during the year as well as the existing term
loan has been utilized for the purpose for which it was availed;

xvii) According to the information and explanations given to us, in our
opinion, short term funds have not been used for long term purposes.

xviii) During the year, the company has not made any preferential
allotment of shares.

xix) The company does not have any outstanding debentures during the
year.

xx) The company has not raised any money by way of public issue during
the year;

xxi) Based on the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given to us by the management, we
report that no fraud on or by the company has been noticed or reported
during the course of our audit.